Airtel hits back at Reliance Jio in battle of trust, ethics, openness
Airtel vs Reliance Jio: Sunil Mittal’s telecom firm hits back a day after Reliance Jio said that Airtel’s move to the Competition Commission of India was a ploy to distract the department and the telecom regulator from the fact that the incumbent has not been allowing Jio points of connectivity.business Updated: Feb 07, 2017 16:42 IST
From gaining customers, revenue and market share, the war between telecom operators -- at least Reliance Jio versus Bharti Airtel -- is turning into a battle of ethics, trust, openness and interoperability.
A day after Mukesh Ambani-promoted Reliance Jio alleged that Airtel was “violating licensing conditions” by not giving adequate points of interconnectivity (PoI), the Sunil Mittal-run telecom behemoth hit back on Tuesday.
“The PoIs have been provided well above the customer growth projection provided by Jio to Airtel. The capacity provided is ideal for serving over 190 million customers on the Jio network,” Airtel said in an statement. Reliance Jio has 72.5 million subscribers.
Airtel claims that it has provided 35,000 PoIs to Reliance Jio in the short span of five months -- of which 27,719 PoIs have been dedicated for incoming calls from Jio customers -- the highest among all operators.
Reliance Jio and Airtel have been waging an existential battle, after Ambani’s new telecom operator started offering data free of cost. Profits squeezed, and a price war began, as Reliance Jio continued to offer free data after the stipulated 90-days period.
Even before extending its free data offer, the telecom industry was hurt. “India mobile revenue growth stepped down in July-to-September quarter (2017), led by Reliance Jio’s “free offers”. The impact on growth was higher in data heavy markets,” brokerage firm CLSA said in a report.
Airtel moved the telecom tribunal TDSAT, against the Telecom Regulatory Authority of India for having allowed Reliance Jio continue with its service. TRAI dismissed Airtel’s plea.
Soon enough, Airtel filed a complaint in the Competition Commission of India (CCI) that Reliance Jio has built a pan-India telecom network and distribution infrastructure, and is providing free voice and data services.
In return, on Monday, a Reliance Jio spokesperson said, “This latest salvo by Airtel is a clear ploy to divert attention from its own violation of licensing conditions by having denied adequate POIs to Jio and the already announced censure proceedings by the TRAI against them.”
Meanwhile, the Telecom Commission of India has given TRAI a 15-days notice to explain how it slapped Rs 3,050 penalty on Airtel, Vodafone and Idea Cellular, questioning the regulator’s methodology. TRAI had slapped the penalty on operators for not providing adequate PoIs to Reliance Jio.
Airtel, too, on Tuesday dismissed all of Reliance Jio claims.
It said that Airtel has honoured its “regulatory obligations” and has provided PoIs “ahead of the commencement of its (Jio’s)commercial operations.”
The Reliance Jio spokesperson had said that Airtel acting “against consumer interest” by opposing the ‘free voice’ benefit that Jio is providing using the internet.
Airtel in its note hit back mentioning that the Reliance Jio’s “constant rhetoric” on PoIs is to “cover up technical issues in their own network”, hinting at the consistent call drops. It also said that due to the bad voice quality on Reliance Jio’s network, the voice traffic on its own network has grown in leaps and bounds.
On the contrary, Airtel said that it has given Reliance Jio more PoIs in ratio to other telecom operators. To Vodafone with 202 million customers has provided 40,600 points, to Idea with 185 million customers it has given 38,130 points, to Reliance Communications with 86 million customers 13,400, and Telenor with 58 million customers 9000. Moreover, all these PoIs have been provided over a longer time period.
Earlier, Reliance Jio had said that Airtel and the other incumbents have formed a cartel to stonewall the new player. “The telecom sector progresses due to disruptive innovation brought in by a new comer, but unfortunately, the incumbents led by Airtel have always tried to block such initiatives,” the Jio spokesperson said.
If global practices are a benchmark, the US telecom regulator Federal Communications Commission (FCC) is inquiring about free data programs and television services provided AT&T, Verizon Communications, Comcast Corp, T-Mobile USA.
The FCC has written letters that raise concern over, if Verizon and AT&T violate the premise of net neutrality, which states that all data should be treated equally. Free data might just go against this principle, as it forces users to stay away from competitor’s offerings.
On January 20, former FCC chairman Tom Wheeler told Reuters that free data practices were “free data practices were abusive and anticompetitive.”
Analysts have also mentioned about the difficult times in the telecom industry. “The entry of Reliance Jio and its hugely disruptive free distribution of SIM cards to rapidly build up scale are clearly proving to be a catalyst,” a report by Bernstein said after Vodafone announced a merger with Idea Cellular.